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ECONOMIC TRACTS. No. I. 

ISTJUBUTED BY THE SOCIETY FOB POLITICAL EDUCATION. 


THE ELEMENTS 

OF 

NATIONAL PROSPERITY; 

AN ADDRESS BY 


EDWARD ATKINSON 

AT THE 

©petting of tfjc Second annual jFair of tfje Ncto lEnglanti 
manufacturers’ anO mechanics’ Institute, 

IX BOSTON, 

Wednesday, September 6 , 1882 . 


DISTRIBUTED BY THE SOCIETY FOR POLITICAL EDUCATION TO ITS MEM 
BERS, WITH ENDORSEMENT AND RECOMMENDATION. 


. Lo A* 


BOSTON: 

FRANKLIN PRESS: RAND, AVERY, & CO. 
1882. 


* 



ADDRESS 




DELIVERED BY 


EDWARD ATKINSON 


AT THE 


©penittg of tfjc SrconO Annual JFair 

OF THE 

New England Manufacturers’ and Mechanics’ Institute, 


IN BOSTON, 


Wednesday, September 6, 1882. 


BOSTON: 

FRANKLIN PRESS : RAND, AVERY, & CO. 
1882. 













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DEC 1 7 1945 

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ADDRESS. 


Mr. President, Gentlemen of the New England Man- 
ufacturers’ and Mechanics’ Institute, Ladies and Gen- 
tlemen, — I have been asked to open this Fair with an address 
which shall indicate the purposes and methods of its work, as 
they are defined in the minds of those who founded this Asso- 
ciation : I will come directly to the subject without taking up 
your time with any further introduction. I shall speak with- 
out much regard to the danger of being dry or abstruse, but 
will endeavor, as far as in me lies, to present thoughts which 
will be, at least in some degree, commensurate with the impor- 
tance of the occasion. I shall not hesitate to reiterate some 
statements to which I have previously called attention, but 
which can hardly be too often presented. I shall spare you 
statistics as much as possible : they will be found in the notes 
if this address is published. 

The purpose of this Fair is instruction in the application of 
science to the useful arts. In what manner and to what extent 
this purpose may yet be developed, depends upon the way in 
which it is sustained by exhibitors and b.y the public. Its 
method is to bring annually into public notice all the recent 
improvements in machinery, tools, and appliances, to which the 
inventors, promoters, or owners desire to call attention, with a 
view to their general introduction. Its medal is a dollar, 
earned in recompense for a service rendered. It is based upon 
the simple and fundamental yet little-understood principle, that, 
in all true commerce, men serve each other. 

It also gives to sections, to states, to railway corporations, 
and to individuals, the opportunity to bring here, and spread 


4 


before the eye, examples of the undeveloped resources in which 
they are severally interested ; to exhibit the potentiality of the 
future ; and to show the way to the place where men may sup- 
ply their wants, and attain welfare. 

To this end, especial attention has this year been given to 
the great middle section of our Southern land, — the land of 
high and beautiful mountains, the highest east of the Missis- 
sippi ; heavily timbered to their very tops ; divided into ranges 
by upland valleys of unequalled beauty, salubrity, and fer- 
tility; underlain by “all the minerals which animate the arts;” 
and surrounded by broad upland plateaus where every crop of 
the temperate and semi-tropical zones finds its true soil and 
climate. 

To this grand tangible prophecy of future national welfare 
I call your attention ; and I may repeat to you what I have 
said to the people of the South, in the hall of their great Expo- 
sition at Atlanta, knowing that you will respond as heartily as 
they responded. With them let us all be thankful that the 
principle of liberty established by our common ancestors — by 
Washington and Adams, by Patrick Henry and John Han- 
cock, by Laurens and Hamilton — could not be subdued, but 
has dominated both them and ourselves. Let us thank God 
that the Potomac has not become the Rhine dividing two hos- 
tile nations, and rendering the oppression of great standing 
armies necessary for each ; but that this “ Union stands, now 
and forever, one and inseparable,” bound by the iron bands 
over which peaceful commerce finds its unobstructed way, and 
by the common interests of mutual service which only freemen 
can render to each other. 

We welcome our Southern brethren to this Fair, and invite 
their co-operation in carrying out its purpose and in sustaining 
its methods. No broader, more national, or more beneficent 
purpose could be presented; and it being a most righteous 
purpose its methods will develop themselves as time goes on. 
It cannot fail. Why is it necessary? The answer is plain. 
Prosperity consists mainly in ample production, sustained by 
quick and ready distribution ; not much in what is commonly 
known as accumulated wealth. It is given to very few mem- 


5 


bers, even of this community, and to a yet smaller portion 
of the human race, to possess wealth and leisure under such 
conditions that they may devote themselves to science, art, or 
knowledge, for their own sakes only and without regard to 
their application to industry. 

It is a matter of necessity, and always will be, that by far 
the larger part of the community — at least nine out of ten, 
probably more — shall earn their daily bread by their daily 
work. The true end to be sought, therefore, is to make that 
daily work less arduous. 

It is not of much consequence that dollars shall be more 
plenty if each dollar will buy more in this year than it did in 
the last. 

I shall presently prove to you that the measure of comfort 
which each man, woman, and child can yet enjoy on the aver- 
age, even in this prosperous land, must come within what half a 
dollar a day — possibly, not even probably, sixty cents — will 
buy at present prices. 


The computations of the value of annual product will be given 
farther on. Different economists have varied in this computation 
in such measure, that their estimates, applied to our present popu- 
lation, would range from seventy-five hundred to ten thousand mil- 
lion dollars. I have adopted the latter, which gives half a dollar a 
day to each man, woman, and child. 

We now number about fifty-four million, or we shall reach that 
number very soon. The following table will show how rapidly an 
addition of products to the value of five cents a day, per capita , 
increases the gross annual product: — 


At 35 cents per day our annual product is 


40 “ “ 

45 “ “ 

50 “ 

55 “ 

60 “ “ 

65 " 

70 “ “ 


«< 

«< 

it 

<i 

a 

a 

a 


. $6,898,500,000 
. 7,884,000,000 

. 8,869,500,000 

. 9,855,000,000 

. 10,840,500,000 
. 11,826,000,000 
. 12,811,500,000 
. 13,797,000,000 


Even the whole waste and cost of war must come from each year’s 
product during the war itself, except such munitions as may be 
borrowed from other countries. Debt incurred for war merely defers 
payment. 

The first question of wages is a question of quantity, — how much 
is there produced ? 


6 


The second question is the question of price, — what is the product 
worth? 

The third question, the question of distribution, — what share of 
the product at its price does the workman receive? 

The wages fund is not the quantity of things previously produced, 
but it is substantially the quantity produced at the time or in the year 
in which the work is done. 

Fifty cents a day is very surely the average measure of the 
subsistence, savings, and taxes of each person. One dollar a 
day for each adult, two dollars a day for each family group 
of two adults and two children, is the limit, because there is 
probably no more to buy. By so much as some of you enjoy 
more, others must have less, if such is the measure of all there 
is annually produced. What have each one of you done, what 
are you doing now, to entitle you to more than what half a 
dollar a day will pay for in food and fuel, shelter and cloth- 
ing? Are you rendering service equivalent to your greater 
gain? Are you engaged in useful work by which the abun- 
dance of things is increased, and the general struggle for life 
made easier? 

That is the purpose of those who have founded this Associa- 
tion. The glowing visions of quick and beneficent results, 
which moved our friend Mr. Mudge, — whose presence we miss 
and whose absence we mourn so much to-day, — may perhaps 
only be an incentive to us to try to realize them; but what 
can be done by the zeal and practical energy of your present 
president and his associates, we may be sure will be accom- 
plished. 

This measure of subsistence is indeed very limited : but only 
those can be permanently helped to enlarge it who can help 
themselves : and few have done more to establish the practical 
arts upon a scientific basis by which abundance may be increased, 
than the men who remain in charge of this work, and who con- 
trol and direct the work of this Association. 

The small minority of the people who can become the pos- 
sessors of capital in any large measure, even in this great and 
prosperous nation, must justify the leisure which they or their 
fathers have earned, by the use which they make of the time 
and means at their disposal. 




7 


The great benefit which ensues in the application of modern 
inventions to useful productions consists not in the accumula- 
tion of wealth, but in the general relief brought about by these 
inventions in the daily work of life. A larger product, and 
therefore more ample consumption, are assured from less labor, 
measured either by hours or by effort ; dangerous and noxious 
conditions of work are abated or alleviated; and it can be 
clearly foreseen that the time is not far distant — if it is not 
now present — when even a moderate degree of intelligence and 
of effort will assure a reasonably good subsistence to every man 
and woman in the community, who is not disqualified from work 
by laziness, vice, or inherent ’disease. These new inventions and 
appliances also increase wealth ; but, so far from its being proved 
that such an increase is of necessity complemented by increase 
of poverty, in this country at least the very reverse is true. If 
my observations possess any value, they prove to me that mate- 
rial prosperity, measured in terms of wealth or income, is like 
a pyramid constantly rising as if lifted from above, as well as 
sustained from beneath ; and as the apex of the great fortunes 
steadily rises, while such fortunes are relatively few in number, 
they do not burden those who are below; but they lift the base 
higher and higher, and make room for increasing numbers who, 
except for this lifting power of capital, could have found no 
place, and might have starved ; while, on the other hand, those 
who come in at the base, which grows broader and broader with 
each year, sustain the fortunes of those who are above, without 
being oppressed by them. The prosperity of each and all rests 
upon the basis of certain definite rules for the possession of 
individual property both in land and things, — property in pos- 
session, and property in use. 

Yet these very rules which have taken the form of statute- 
laws, and which have been gradually evolved in the experience 
of men, may themselves be abused, and may become instruments 
which for a time retard progress rather than promote it. This 
may be especially true in respect to the possession of land. 

At the foundation of all property, and underlying all consid- 
erations affecting the title to things made by human labor, lies 
the question of the title to land. Every thing which can be 


8 


applied to human subsistence must come either from the field, 
the forest, the sea, or the mine. To the multitudinous seas, no 
individual claims title ; but to the land, many claim it. From 
whom is their title derived ? There are no direct grants from 
the Almighty ; but it has been proved in the course of human 
experience that land itself is but a tool, the most productive 
use of which depends upon individual possession. Where mere 
possession is abused rather than used, and any large portion of 
the product is diverted from the subsistence of those who do 
the work, — in the form of rent to absentee owners, as in Ire- 
land ; or in the form of taxes for the support of great standing 
armies, as in Germany and France, — revolutionary changes, 
either under the forms of law or in spite of law, may become 
necessary. 

Witness the acts of legislation lately passed by the Parlia- 
ment of Great Britain, which are in part acts of bankruptcy for 
the discharge of debts incurred for rent, and in part a recovery 
by the nation of the control of titles to land, which have been 
abused. 

How soon may similar acts become necessary in England and 
Scotland, no man can tell. Perhaps our present great harvest 
in the United States, meeting a fair harvest in Europe, may so 
reduce the price of food as to make even the present reduced 
payments of rent on English land impossible ; and then must 
inevitably come a profound change in the whole system of Eng- 
lish land-tenure, and a yet greater change in the forms of Eng- 
lish society, under which seven thousand people now claim title 
to four-fifths of her whole soil. Appalling as these questions 
are, the}*- are simple compared to those which must be solved 
upon the Continent. The standing armies of Europe are as 
impossible to be sustained many years longer, as they are to be 
disbanded, without bringing society almost to a state of anarchy ; 
yet they must be disbanded in the face of our competition for 
the commerce of the world, when we become conscious of our 
own strength, and claim our full share in the peaceful conquest 
of nations. 

Witness the great migration, partly forced and partly volun- 
tary, from these overburthened lands. To this country, — in 


9 


which the proportion of adults in the total population is already 
greater than in many other nations, — have come nearly a million 
and a half of immigrants, mostly in the prime of life, in the last 
two fiscal years ; and in the present year a million more may 
come. We are engaged in a work by which the antagonisms of 
race and language of the Old World will be overcome. Democ- 
racy is the solvent, and the common school is the crystallizing 
medium. Presently the people of this land will have ingrafted 
upon the narrow but versatile intellect of the Yankee, the cour- 
age and endurance of the Englishman, without his pig-headed- 
ness ; the cleanliness of the Dutchman, without his stolidity ; 
the thrift of the French peasant, without his superstition ; the 
artistic sense of the Italian, without his treachery ; the wit of 
the Irishman, without his incapacity to trust his neighbor ; the 
philosophy of the German, without his scepticism ; the acquisi- 
tiveness of the Jew, without his selfishness; the manual dex- 
terity of the Chinaman, without his idolatry ; and the fun and 
music of the Negro, without his shiftlessness. 

Will not such a polyglot race make something of this land 
more than we can yet conceive ? What will its moral and ma- 
terial influence be a century hence? 

But what — some one may ask — is the application of this 
statement to our present purpose? What have we to do with 
the Irish question? Where is the connection with this Fair? 
It is partly this, — that the Irish peasants who are being forced 
to migrate will, many of them, come here ; with them are com- 
ing Italians and Germans, also forced to migrate by similar 
causes : and unless we provide in the right way for the instruc- 
tion of the children of these adults, who are now, and have long- 
been, almost paupers, we shall have the Irish question forced 
upon us, only in a new form ; and that form will be, how to deal 
with a mass of people, who, without fault of their own, have 
become incapable of availing themselves of the advantages of 
the modern applications of science, and for whose merely man- 
ual labor or brute force there may be less and less demand as 
time goes on. Long years, ay, centuries of submission to the 
privilege of class and caste, to bad systems of land-tenure, to 
the intolerance of a priesthood jealous of intelligence, and to 


10 


prejudice against wealth, have prepared many of these new- 
comers to become the dangerous element in our body politic, — 
the tools of the demagogue and the instruments of the knave ; 
and, unless we can reform and regenerate their children, our 
children may be called upon to face economic questions which 
nothing but force can settle. 

It takes two to make a bargain — that is, to make an ex- 
change ; and it often happens that the very things which every 
one needs can be produced in greatest abundance, but there is 
no possibility for many to share the abundance, because they 
have not been so trained as to be able to render a service in 
exchange ; they are only common laborers ; and at that time, 
and in that place, common labor is not wanted. 

The material welfare of a people depends, as I have said, not 
upon one, but upon two factors, which are each the necessary 
complement of the other : — 

1st, An abundant production. 

2d, A quick and equitable distribution. 

Bad institutions ; the unwarranted interference of statutes 
with individual rights ; the abuse of the power of taxation ; the 
waste of public money; the creation of a class of public spend- 
thrifts who batten upon the labor of a people under the forms 
of law ; ignorance among great masses, and incapacity to adopt 
the new industrial methods which every day assume new forms, 
— may, even in this country, as in all others, interfere with 
equitable distribution, and promote scarcity. 

Witness the burden of the standing armies and of the privi- 
leges of the few in other countries, to which I shall presently 
call your attention more directly. True, we are free from these 
special evils ; but let us ask ourselves, how long can w.e bear 
without moral, mental, and material degradation, the corruption 
of the civil service, the spoils system in politics, and the abuses 
of the power of taxation in cities, states, and nation, which are 
not only a consequence, but a most potent cause of civil-service 
corruption ? 

But let me return from this digression. The subsistence of 
each year consists mainly in the distribution of the products of 
the soil, the forest, and the mine, of that special year : perhaps 


11 


a small part of the product of one, or, at most, of the two pre- 
vious seasons, are consumed this year ; while a small part of this 
year’s product is saved for the next. ^ 

In respect to food, the world as a whole is always within one 
year of partial starvation. If work ceased, the most prosperous 
country would be reduced to general starvation in two, or at 
the utmost three years. 

In respect to clothing, and the materials for clothing, the 
world is alway's within two or three years of becoming naked. 

In respect to shelter, if work should cease, and repairs were 
not done, the world would be houseless and homeless almost in 
a single decade. 

In respect to the common ways, our roads would soon become 
impassable, if not maintained year by year ; our railways would 
be dangerous and presently useless, if the trackmen did not 
keep up their daily inspection and repair. 

In respect even to the great works and factories, it has come 
to be the conclusion after long observation, even of the most 
sagacious, that it is almost useless to plan any thing except 
foundations for a life of more than twenty-five years ; and 
within that term, in almost every department of manufacturing 
and mechanical work, all the machinery will have been once or 
twice wholly changed. Hence it follows that each year’s life is 
substantially sustained by each year’s work ; and this work can 
never cease, because it is almost wholly spent in sustaining 
existence : but little can be saved. 

It is impossible to prove what portion of each yeaVs product 
constitutes its cost. I think, from my own observation, fully 
ninety per cent. 

Within the limits of this address, I cannot give the data on which 
this conclusion is based; but I think it will be apparent that at least 
nine-tenths of the value or substance of our annual product, whatever 
its amount may be, must be shared among those who constitute the 
working force, if the following unquestioned facts are considered. 

The capital invested in all the departments of manufacture of 
Massachusetts does not exceed in amount one-half the value of the 
gross product of manufactured goods : five per cent profit on the goods 
will therefore yield ten per cent per annum on the capital. At this 
rate all the capital will be supplied and invested which the demand 
for the goods will warrant. 


12 


It therefore follows, that, wherever an opportunity can be found to 
pay ninety-five parts in a hundred to workmen and for materials, that 
opportunity will be taken. 

The^ame analysis may be applied to the raw materials used in the . 
factories; and the same rule will serve, except that, as a rule, the pro- 
portion of capital necessary for the production of raw material is less 
than is needed in the factory : therefore a larger share of the annual 
product of raw material must be assigned to labor. 

In respect to distribution, it may be considered that the range of 
commissions and of profits in large establishments is from one to five 
per cent ; and from this small commission all the subsistence of those 
who do the work is paid. 

No great merchant of modern times can save for himself one per 
cent, or one dollar in a hundred, of the value of the goods in which he 
deals. I therefore think it can be proved that nine parts in every ten 
of each year’s product are divided among those who do the daily work 
for their daily bread, and that ten parts in a hundred are the utmost 
that can ever be set aside for the maintenance or increase of capital 
or of wealth. 

Nine-tenths at least of our annual product are therefore spent in 
its production or in its distribution, and therefore constitute the cost 
of each year’s subsistence. 

This estimate is very surely a safe one. If the annual product is 
greater than I have computed it, then even a larger proportion is 
consumed, and a lesser percentage is saved. 

It Tyould be interesting and instructive if census data could 
be compiled which would give accurately the measure of our 
annual product in terms of money, and also determine the por- 
tion spent for mere subsistence ; but it is practically impossible. 
The difficulties are, first, the home or family consumption of 
the agricultural population, which never finds a place in our 
market-reports. Even the ascertained market value of our 
dairy product is as great or greater than that of the com- 
mercial cotton-crop; but who can measure the value of the 
milk consumed on the farm? Again, cotton, wool, leather, 
iron, and the like, are listed in the census under their own 
titles, but are duplicated as a part of the value of the manu- 
factured goods. 

There is, however, one way of making an approximation to 
the value of our annual product and its expenditure, and an 
estimate of our annual savings. We now number about fifty- 


s 


13 

four million, over one-fourth of whom are adult males of vot- 
ing age ; and it may therefore be assumed that another fourth 
are adult women. If we assume that the actual subsistence, 
repairs of dwellings, public expenses, and other annual items of 
cost, including all the home productions consumed on the farms, 
would have a value, if all were priced at the market standard, 
of one hundred and fifty dollars a year per capita , or forty-one 
cents a day, then our annual product which is consumed must 
be priced at eighty-one hundred million dollars. This would be 
six hundred dollars a year for each family group of four, aside 
from savings. 

I do not think it possible to assume less than forty-one cents 
a day as the cost of subsistence, cost of repairs of dwellings, and 
proportion of national, state, and municipal taxes, for each mem- 
ber of the nation, men, women, and children included, and 
also including domestic farm consumption. 

If this sum measures in money the actual cost, that is to say, 
the consumption necessary for each year’s work, and if this is 
ninety per cent of each year’s product, then we have a product 
of the value of nine thousand million dollars, and an annual 
surplus, used either to maintain or added in part to the wealth 
and in part to the capital of the country, of nine hundred 
million dollars. 

If the average daily measure of the annual product consumed 
by each person be a little more, or forty-five cents a day, con- 
stituting nine-tenths of that day’s product, then the total meas- 
ure of production is fifty cents for each man, woman, and child. 
This would give ninety cents a day for the value to themselves 
of the work of the adult men and women who compose one- 
half the population, and ten cents over for the maintenance and 
increase of capital, counting three hundred and sixty-five days 
to the year. At this rate the annual product of each adult 
man and woman is measured at one dollar a day, or at three 
hundred and sixty-five dollars a year ; of which $328.50 is ex- 
pended for the subsistence, shelter, and taxes of one adult and 
one child ; and $36.50 is set aside for-the maintenance and in- 
crease of capital. At these rates, our total annual product, if 
measured in money, would be $9,855,000,000, or in round fig- 


14 


# 


ures $10,000,000,000 worth a year ; and the portion set aside 
for the maintenance and increase of capital, ten per cent, or 
in round figures $1,000,000,000. A large part of this latter 
measure, more than one-half, must be applied to the mainte- 
nance of existing capital ; the rest is added to the wealth or 
to the capital of the country. 

In point of fact, the census data, as far as we have them, tend 
to prove these figures to be substantially correct, especially of 
the measure of the annual product to be assigned to each one 
of the working force ; the real working force being less than 
one-half of the population, and the average product somewhat 
over the measure of one dollar a day for the year through, 
including Sundays, so far as the data are yet published. 

It may seem almost appalling to those who are not accus- 
tomed to submit to such a narrow measure of comfort, to be 
assured that the total annual subsistence, shelter, and taxes of 
each man, woman, and child, together with the entire margin 
for the profit or saving, must come within the measure of what 
half a dollar a day will buy ; yet this must be so, because that 
is probably the measure in money, at market prices, of all that 
is produced. We cannot have more than there is, and this is 
very surely all there is. Even if it be seventy cents a day, 
would it not then be true that one-tenth part of the people of 
the world little know how the other nine-tenths live ? 

The family unit of this country consists practically of four persons, 
there being one adult male of voting age in each four. At fifty cents 
per capita, as the measure of the total production (including domestic 
farm consumption), the gross value of each day’s average product 
would be two dollars ; equal to seven hundred and thirty dollars per 
. year for each family. Ten per cent off, for the maintenance and in- 
crease of wealth and capital, leaves six hundred and fifty-seven dollars 
per year net; which would be, under these conditions, the average 
measure of consumption of each group of four persons, including all 
taxes, at the retail prices of commodities — that is to say,, at the 
prices which measure the final distribution of all products. 

National, state, and municipal taxes divert about seven per cent 
of the computed annual product from the pockets of the producers 
to those who perform the necessary functions of government : this 
deduction for taxes leaves a little over six hundred dollars a year net 
to each family of four persons. 


15 


This is a large estimate for an average family of four, rather than 
a small one; and I have erred, if at all, on the liberal side of the esti- 
mate; my point being to prove that the average subsistence of each 
man, woman, and child in this prosperous country, must be limited to 
the measure of what forty to fifty cents a day will buy. 

We must add one thousand million dollars’ worth to the product of 
each year, in order to be able to add only five cents’ worth per day to 
the consumption of each person ; so close do the footsteps of want press 
upon the limits of welfare. 

Who dares scout the science which, under the name of “ political 
economy ,” treats these vast questions of human t welfare, in which a 
single error or misapplication of the functions of government may 
cost the very lives of armies of men a century hence? 

The abuses of centuries are culminating in Ireland to-day; and the 
compromise with slavery, to which our ancestors consented, cost the 
lives of more than half a- million men, and imposed upon us the bur- 
then of our present debt, and our complicated and onerous system of 
taxation. Slavery was only a form of the organization of labor, a 
false method of inducing production. 

What, then, can we do to make the struggle for life easier? 
The only answer is: Give such instruction as will develop brain 
and hand together, so that the purchasing power of each dollar 
may be increased. Save the waste of labor and the waste of 
product.' We are the most wasteful nation in the world ; and 
one reason is, that, even at our present measure of product, 
there is vastly greater abundance here than there is anywhere 
else. 

What margin is there for increase, or for saving, do you ask ? 
The answer is plain. Our general methods of agriculture are 
poor and shiftless ; our crops are not one-half what a reasonably 
good system would bring forth. The potentiality of a single 
acre of land is still almost an unknown quantity. If I were 
to say to you, that, next to the abolition of slavery, and the 
use of the railway and the steamship, the re-discovery of the 
method of saving green crops — called ensilage — was the most 
important event in its effects on material welfare of the present 
century, you might suggest that a commission of lunacy should 
be appointed to examine the condition of my brain. Consider 
the waste of fencing, because one man cannot trust his neigh- 
bor to keep his cattle where they belong. Witness the waste 


16 


of sheep, because the cur dog is tolerated while the farmer 
suffers. 

Marvellous as the machinery in this great building may be, 
science has work to do vastly greater than any thing yet 
accomplished. Almost the only tools yet perfected are the 
water-wheel and the dynamo-electric machine Look at that 
seemingly perfect steam-engine and boiler: it wastes nine- 
tenths of the fuel with which it is supplied. Examine that 
costly and clumsy locomotive and heavy train of cars: only 
one pound in a hundred of the fuel used is actually applied to 
the movement of the load. Observe that almost self-operating 
carding-engine, spinning-frame, and loom: are they perfect? 
Four-fifths of the power is wasted in operating them ; and, 
when you have put your cotton fibre into cloth, you have lost 
three-fourths of its original strength by your rough treatment. 

Your builders cut up your timber so as to lose or waste one- 
half its strength; most of your architects plan your build- 
ings so as to assure the most perfect combustion. You make 
a clumsy effort to distribute your fire-loss of nearly a hundred 
millions a year through insurance companies, and you waste 
forty per cent of your premiums in the mere expense of making 
the attempt. You cannot even start a horse-car without wast- 
ing the knees of your horses by the excessive strain. 

I might go on in this line indefinitely, but the greatest waste 
of all is the waste of food and fuel. 

The grain, root, and hay crops of this country weigh over one 
hundred and fifty million tons, — three hundred thousand mil- 
lion food pounds to be harvested, sorted, distributed, converted 
into meat, butter, cheese, bread, and the like, in order that each 
one of us may have our daily ration of about three pounds, — a 
pound each for our breakfast, dinner, and supper. 

Seventy million tons of coal are mined and converted. Are 
we not all aware that half our food is wasted, and perhaps more 
than half our fuel, especially in cooking? 

How shall we save this waste ? Must we not save it if each 
man, woman, and child can earn, on the average, only what 
fifty cents a day will buy? Try for yourselves what you can 
get in the little shops on the South Cove, or at the North End, 


17 


where the poor must buy their food; and, then you will know 
why so many suffer want, even in the midst of plenty, for the 
lack of instruction in the commonest arts of life. Must not 
our common schools be somewhat common in quality, when 
they qualify their pupils so little in the practical arts of life? 

And here let me call your attention to the importance of the 
smallest fraction saved. In order to do this, I must repeat my- 
self. The average charge upon the New York Central and 
Hudson River Railroad, in 1866-69 inclusive, was 1.9567 cents 
in gold, — say, two cents per ton per mile. From 1870-79 
inclusive, it was 1.1123 cents. The difference was only .8444, 
say eighty-five one-hundredths of a cent per ton per mile. 
Yet, in the ten years last named, this difference saved the con- 
sumers of the goods carried over this one line one hundred 
and twenty-one million gold dollars. 

The average charge over this line has been again reduced, 
and was last year only seventy-eight one-hundredths of a cent 
per ton per mile. 

This line performs one twenty-sixth part, only, of the rail- 
way service in moving merchandise of the United States. If 
all the other railways have reduced their rates since 1869, only 
one-half as much as this corporation has reduced theirs, — 
which is far within the fact, — the saving on the moving of 
merchandise in the year 1881, as compared to the rates prevail- 
ing from 1866 to 1869, — only twelve to fifteen years since, — 
was over $400,000,000. Let us be conservative, and call it 
only $300,000,000 ; and then we have a sum more than suffi- 
cient to pay the first cost of the 9,400 miles of new railroad 
which we added to our service in that year. 

Eighty-five hundredths of a cent a ton a mile is equal to $8.50 
per ton from Chicago to Boston, or less than a dollar on a barrel 
of flour carried a thousand miles ; yet this little fraction, applied 
only in part to the total traffic of all the railroads of the United 
States, worked a saving of over $200,000,000 a year, for ten years 
to 1879, inclusive ; and^at the yet lower rates of 1880 and 1881, 
as compared to 1866-69 inclusive, this . saving has been, at the 
very least, $300,000,000 a year, or 33 £ per cent of the estimated 
amount of our possible annual addition to our wealth or capital. 


18 


It has not been added to capital, however : by far the larger 
part has gone to the benefit of consumers, and has been saved 
by them in the work of gaining their subsistence. This is the 
function of capital in the form of a railroad. 

This is a complete example of the thesis which I have-pre-.. 
sented. These great applications of science save a part of the 
necessary work, and render the struggle for life far easier. 

The figures which prove this proposition are so startling that it 
is necessary to sustain them by citing the actual facts. In the year 
1881 the New York Central and Hudson River Railroad moved 
11,591,379 actual tons of merchandise, or 2,646,814,098 tons carried 
one mile; for which service it received $20,736,750, or seventy-eight 
hundredths of a cent a ton a mile. The average charge from 1866 to 
1869 for the same service (rates reduced to gold) was 1.95 cents per 
ton per mile (1866 to 1869, inclusive, 10,102,659 tons moved; 1,868,- 
448,179 tons moved one mile; receipts in currency, $50,556,876): 
difference, 1.17 cents per ton per mile saved on 2,646,814,098 tons, 
equal to $30,970,000, in the single year 1881. 

In the year 1881 the total receipts of the New York Central and 
Hudson River Railroad for freight constituted per cent of the 
total freight receipts of all the railroads of the country, or a fraction 
under one twenty-sixth part of the whole. 

If the reduction in the freight charge on other roads, or the saving 
which has been compassed by the construction of new lines, has been 
equal to that on this line, — 1.17 cents per ton per mile, — the saving 
would amount to over $823,000,000 in the single year 1881, upon the 
traffic of that year. 

Mr. H. V. Poor computes the whole traffic of all the railways of 
the United States, including coal, at not less than three hundred and 
fifty million tons, or more than thirty times the quantity carried by 
the New York Central and Hudson River Railroad. 

Let me repeat this proposition: if the construction of new lines, 
and the reduction of charge on old lines, has saved consumers one cent 
and seventeen-hundredths per ton per mile upon the actual traffic of 
the year 1881, as compared to the charge made for railway service 
from 1866-69 inclusive, the difference in fhe year 1881 amounted to 
over eight hundred million dollars. 

The fortunes which the railway magnates have secured to them- 
selves, and which they are now applying in part to an extension of 
the railway service by at least ten thousand miles in the year 1882, 
constitute but a small pa,rt of this saving : the greater part has been 
secured by consumers, and has to that extent reduced the cost of 
subsistence. 


19 


Upon this basis the computation of an actual saving to consumers 
of $300,000,000, as given in the body of the address, may be consid- 
ered a very safe and cautious one. 

In fact, the effect of the construction and extension of our railway 
service, and the progress made since the panic of 1873 in the reduc- 
tion of its cost, almost transcends comprehension; and all computa- 
tions and forecastings based upon these changes have a visionary 
aspect even to the most careful student. The gain in this respect 
more than compensates for the waste of public money and the abuses 
of the powers of taxation, and thus even retards the progress of 
economic reform by obscuring the evil effects of excessive taxation. 

In this address it is therefore made apparent, on the one hand, that 
the average measure of comfort which each man, woman, and child 
can enjoy must come within the substance of what half a dollar a day 
will buy; while, on the other hand, this analysis of the result of sci- 
ence applied to the construction of railways proves, that, after making 
due allowance for the fluctuations of the seasons and the variation of 
the crops, the purchasing power of each half-dollar has been increased 
at least five per cent, perhaps more, since 1870. 

I have computed the present value of the products of the United 
States, at the place of consumption, at $10,000,000,000, which gives 
each inhabitant fifty cents’ worth a day. 

The freight earnings of the railroads of the United States in the 
year 1881 were $551,968,477. 

The cost of distribution by rail was, therefore, five and a half per 
cent upon the computed value of the product. 

At the higher rates of 1866-69, this charge for railway service might 
have been $1,350,000,000, which would have been 13| per cent upon 
the computed value of our whole product. If consumers have gained 
the sum used in the body of this address, — $300,000,000, — then the 
purchasing power of each half-dollar has been increased three per 
cent since 1870. If $500,000,000, then five per cent. If $825,000,- 
000, then over eight per cent. Add to this amount saved by railroads 
the results of the improvement in machinery applied to agriculture, to 
manufactures, and to the mechanic arts ; and I think it is safe to repeat 
what I have elsewhere affirmed, that the aggregate labor of the people 
of the United States has been made at least one-third more effective 
by the application of science to the useful arts since the end of our 
civil war in 1865. 

In other words, the purchasing power of each person’s daily income 
of half a dollar has been increased one-third in less than twenty years. 
How soon will it be doubled? It now costs more to live, because 
people demand more, spend more, and, on the whole, enjoy more, than 
they used to; and they also waste more. The wages of factory oper- 
atives are double what they were in 1842, and the hours of labor are 


20 


ten to eleven per day now, as compared to thirteen then. The daugh- 
ters of New England farmers have found less arduous employment at 
much higher wages; while the immigrants, who now constitute the 
great body of the factory operatives, would then have found only the 
most arduous menial or common labor, could they have then found 
any place in our body politic. 

One of the best definitions of man, as compared to beasts, ever 
given, is this : “ Man is the only animal endowed with progressive 
desires.’ 

The more there is, the more we spend; the more we have, the 
more we want. The measure of a sufficient fortune or income is a 
little more, and thus the world wags on. 

And as it is in this matter of the railroad, so is it in all 
things : the difference between welfare and poverty consists 
only in knowing how to save a dollar in moving a barrel of 
flour a thousand miles. It costs to-day only half a dollar to 
bring a barrel of flour from Chicago to Boston, and a barrel a 
year is all that each person needs. Now, let me ask you, how 
much do we lose in not knowing how to make bread, — how to 
use the barrel of flour? How large a factor in the national 
welfare is in the mere question of household economy? 

How much will this Fair teach us on that subject? Follow 
the wheat from the field to the poor man’s table, and you will 
soon prove to yourselves that ignorance of the simplest house- 
hold arts is a heavier tax than the entire cost of railway service. 
Is this to the credit of our schools ? I will not undervalue in 
the least the mental instruction of the schools; I would not 
deny the opportunity for the highest instruction : but if a large 
portion of the time of the pupils is not spread over a great mass 
of merely mental rubbish, a great injustice is being done by 
their critics. 

In order that these propositions may be made plain, and the 
purpose of this address may become more clear, let me ask you 
to discharge from your minds all idea of money and of price. 
Money is merely an instrument by which the exchange of ser- 
vices among men is rendered easy. Price, whether applied to 
things or to services, is but a measure expressed in terms of 
money. What really happens is this : A small, very small, 
part of the work of each year can be saved in the concrete 


21 


form called capital ; that is to say, in the form of a railway, of 
a factory, of improvements upon land, or developments of a 
mine ; and when thus saved it is so applied as to increase the 
production or lessen the work of the next and of ensuing 
years. 

As I have said, I am of opinion, that, even in this prosperous 
country, not less than nine parts in ten of the total product, on 
the average, constitute the cost of production, and are consumed 
in different proportions by those who do the work. 

To the workman or workwoman it matters not what the 
measure in money is by which their wages or earnings are 
defined. The real question is: How good a house, how large 
a room, how adequate a supply of food and fuel and clothing, 
can I purchase with that money ? 

It therefore follows that every application of science to manu- 
facturing industry, to mining, or to agriculture, by which the 
aggregate of things is increased, while the labor is diminished, 
tends to increase the quantity of the commodities to be divided 
among the laborers ; and, as this increase is progressive year 
by year, the proportion which capital can secure to itself under 
free contract becomes less, while the proportion which is as- 
signed to labor becomes greater. 

The object of this Fair is to bring into prominent notice 
every new application of science by which abundance may be 
increased ; and also to bring to the knowledge of those who 
seek a new place in which science may be applied, the sections 
of country and the natural resources which are yet undeveloped. 
It is a great object-lesson in human welfare. 

But of what use will this great lesson be if boys and girls 
and men and women are not qualified to take advantage of the 
opportunities thus spread before them ? 

It may happen, that, by the application of intelligence and of 
science on the part of the few, the quantity of things produced 
has been greatly increased ; and yet, in the midst of plenty, 
sometimes thousands, ay, even hundreds of thousands of men 
and women have suffered want. Witness 1873. Why is this? 
Must it always be so ? It may be said, it ought not to be ; it 
need not be : and yet it probably will be so for many years to 


come. 


22 


It may be that those who have lived in foreign lands until 
they have come to adult years under obstructive laws or sys- 
tems, and who have not learned how to do any service by which 
they may gain a part of this abundance, except in the common- 
est of common labor, will be very poor, even here in the midst 
of plenty. 

Hence will follow the continued need, not only of charity 
which takes the form of giving alms and sustaining life, but of 
that mental charity also, which, even while repressing the out- 
breaks and disorders which may arise from the presence of those 
who are not only very poor but very ignorant, will yet palliate 
and excuse even the evils which it may be necessary to suppress 
by force. 

But if the grand purpose of those who have founded this 
association can be carried into action, if methods of industrial 
instruction can be added to the mental training of the schools, 
if the hand and the head can be developed together, — as the 
children of these immigrants grow up, they can be qualified to 
render such service to their fellow-men that the measure of 
their earnings or wages shall be ample for their welfare. 

It is by such instruction, by such preparation for the need of 
future generations, that the very causes of want may be almost 
wholly removed. 

Let me illustrate this. Every master-manufacturer, every 
master-mechanic, every capitalist who desires to employ others, 
seeks to hire the man or woman who can make the largest 
product at the lowest cost. And now I beg to present to you a 
proposition which is veiy far-reaching, very subtle, and of very 
wide application, but which is seldom considered unless atten- 
tion is almost forced to it. It is this : So long as freedom of 
contract is not restricted or obstructed by statute-law, so long 
as laws are enacted only for the enforcement of justice and 
order, the prevention of crime and punishment of fraud, and 
the accomplishment of purposes which cannot be worked by 
individuals, it will be found that high wages or earnings are 
almost the necessary correlative of low cost of production ; and 
not, as is so commonly assumed, that low cost can only be com- 
passed by way of low wages. 


23 


This seems a paradox : yet it is elementary, and it is within 
the observation of ever}?- one of you here present ; from your 
own experience you can prove or disprove this proposition. It 
simply needs to be borne in mind that the annual profits of 
capital and the annual wages of labor are both derived alike 
from the annual product. The more effective the capital in the 
form of machinery, the less the number of persons required, the 
higher the wages. The more skill on the part of the persons 
who operate the machinery, still again the less the number 
required, and the higher the wages. The more effective the 
capital, the lesser the proportion which the capitalist will secure 
in order to make good interest upon his investment. The more 
adequate the skill, the larger proportion will the laborer attain. 
The more effective the application both of capital and of labor, 
the larger both the profit and the share of the laborer. And 
when this product is converted into terms of money, or what 
money will buy, the higher the price of wages, and the lower 
the cost of the production. 

It therefore follows that the rate of wages or earnings of the 
masses of the people who are of necessity engaged in their daily 
work for their daily bread will be high or low (always assum- 
ing an honest specie standard for the money in which the sum 
of wages is to be expressed) : — 

1st, According to the conditions and resources of the country 
in which the labor is exerted ; 

2d, According to the freedom of that country from statutes 
under which the liberty of the individual is restricted. 

3d, According to the freedom of that country from the impo- 
sition of taxes by which a large portion of the products of labor 
are diverted from the remuneration either of labor or capital, 
and are applied to what may be named (for the purposes of this 
consideration) destructive taxation. 

Of the first two conditions I need not speak at length ; but I 
may call your attention to our paramount advantage in respect 
to the third. 

There are two kinds of work to which the proceeds of taxes 
are, or may be, applied : — 

1st, Constructive work which the municipality, the state, or 


24 


the nation can perform better than the individual : such as, 
the making of common highways, the maintenance of common 
schools, the postal service, and some other simple functions 
distinct from the administration of justice or other administra- 
tive functions of government. 

In thi-s country even the support of the army may be included 
in the constructive work of government, because it is our good 
fortune to need an army only to serve as a border police, and 
for the protection of settlers engaged in increasing the general 
product. 

But if we compare our condition with that of those states of 
Europe which are called civilized, we find a marked difference. 
In such states, for various reasons, a very large proportion 
of the annual product of labor is taken from the people in the 
form of taxes, and is applied either to sustain special privi- 
leges, or merely to the destructive purposes of war. 

I may cite to you the comparison between this country and 
France and Germany considered together. The long-continued 
error in regard to the true function of commerce, which has 
dominated the mental conceptions of those who assume to 
govern those great states, — to wit, “that, in all commerce, what 
one nation gains another must lose,” — has kept those two 
states apart more than any prejudice of race or difference of 
religion ; but from all these causes combined, — namely, indus- 
trial prejudice, hatred of race, and the perversion of the reli- 
gious idea, — each of these nations finds it necessary to protect 
itself against the other and against all the rest, by maintaining 
standing armies in camp and barracks, which to-day (without 
consideration of the reserves, but including those who are 
engaged in merely preparing material for war) number over 
one million men out of a population of eighty millions. 

Our proportion to-day, if we were obliged or chose to main- 
tain a standing army, in ratio to our present population of about 
fifty-four millions, would be seven hundred thousand men: 
more than one in twenty of all the adult males of voting age 
within the limits of the country would be withdrawn from their 
productive work, whereby the quantity of things to be divided 
between labor and capital, from each year’s annual product, 
would be so much diminished. 


25 


Yet more : one more man in every nineteen of those remain- 
ing would be forced to labor in order to pay the taxes necessary 
to sustain the seven hundred thousand idle men gathered 
together in camp and barracks waiting for the work of destruc- 
tion. 

Let me prove this. This army would be, in its organization 
and in the persons who compose it, like unto the great indus- 
trial army engaged in our greatest works. The officers of the 
armies of Germany and of France must be men of ability, equal 
but not superior to those who lead the industrial armies of this 
country, — equal in capacity but how inferior in purpose, — to 
the men who build and control the railroads and the iron- 
works, manage the factories, bring order and system into 
action, and direct the productive energy of the people. 

The soldiers composing the destructive armies of France and 
Germany are in the prime of life, capable of exerting the maxi- 
mum force ever developed by them. They would be like unto 
those who constitute the working force upon our new railroads 
and in our mines and factories ; and seven hundred thousand, 
which would be our proportion did we emulate those nations in 
the work of destruction, would outnumber the whole force of 
adult males who are to-day engaged in building railroads and 
in all the iron-mines, iron-works, and all the textile factories of 
the United States combined. 

This minus quantity, this reduction of product, this scarcity 
which is enforced upon these nations of Europe by their armies, 
may be measured by the construction of all our new railroads, 
and by the addition to our annual product of all the product of 
our iron-mines and iron and steel works and all our textile 
factories combined, to which the labor of adult men is applied 
(omitting the product of women and children) in these United 
States. 

And yet more : the cost of these great European armies of 
destruction, levied in the taxes and paid by those who are per- 
mitted to remain in the work of production, is more than equal 
to the sum of all the wages earned in this country by all the 
iron-miners, all the iron-workers, and all the men, women, and 
children in our textile factories, put together. 


26 


Must not wages or earnings in this land be higher than in 
any other land thus burthened? Must not the quantity of 
things to be divided — which constitute the true earnings — 
he so much greater, and the cost of making so much less ? 

If you apply these rules to your own experience, each one 
of you, you will find how true they are. The last man or 
woman whom you desire to discharge from the works which 
you control, when the times are hard, is the one earning the 
most for himself or for herself; the first to be discharged is 
the unfortunate one whose hand and brain have not been 
developed together, and who can, in hard times, no longer 
render you a service, even if paid a sum barely sufficient to 
support life. Even if the conditions become such, as they did 
from 1873 to 1879, that skilled mechanics and artisans find no 
demand for all their work, then they, by their very training, 
have been made competent to change the method of their work, 
and in new places, under new conditions, they assure welfare 
for themselves. 

And as it is with persons, so it is with classes, with states, 
with countries. Where the conditions are best, where the 
natural resources are the greatest, if no obstruction is inter- 
posed by statute-law, — there will be found the most skilful 
persons, the best machinery, and the largest product. If, under 
free conditions, you would seek to find the place in which the 
very lowest labor cost of any given thing is compassed, you 
may take as your guide the measure of the highest wages 
earned by those who do the work. 

Where earnings are the greatest, — earnings being but a 
share of a large product ensuing from favorable conditions, 
ample capital, and superior skill, — you will most surely find 
the lowest cost, always provided that in that place justice and 
equal rights are assured, that the government is honest and 
stable, and that the taxes are not diverted from public uses to 
private ends. 

This rule will not apply to hand- work or handicraft. The 
fine silks of Lyons woven only on a hand-loom, the laces of 
Brussels, the fine carving of Switzerland, the Tuscan jewelry, 
the production of tea in China, the spade-labor of Belgium, and 


27 


the like, can only be conducted on the lowest rates of earnings, 
barely sufficient to support life ; and yet the fabric may be of 
extremely high cost, because of the amount of labor, or the 
arduous conditions under which it is conducted. 

There are yet many occupations which we cannot afford to 
carry on in this country so long as we can procure the product 
in some other way, because the amount of labor is so great, or 
the necessary conditions are still so bad. 

We have a continent yet to subdue, in which we can choose 
our work. 

Glance your eye over this vast collection of the potentiality 
of our Southern land. Witness the profusion of every thing 
needed to sustain life in comfort. Observe the coal and iron 
lying close together upon the very surface of the earth, — not 
separated, as they are farther north, by great intervening moun- 
tains of sandstone, but the coal, iron, and limestone lying one 
against the other at the head-waters of great navigable rivers, 
where they can be converted to the use of man with the least 
expenditure of human labor. 

Glance over this great exhibition of timber which has been 
so wasted, even in our Northern States. Witness the variety 
of the products of agriculture which can be brought to the 
service of man amid scenes of utmost beauty ; and, so far as a 
very large section of the Southern country is concerned, under 
conditions unequalled on this continent for health and salu- 
brity. Why have they not been developed? Because labor 
was not honored, and he who exerted it could not enjoy the 
earnings. 

Why are they being developed now so rapidly? Because 
the South to-day is even in advance of the North in the effort 
which she is making to promote the instruction of the hand 
and the head together, in order that she may avail herself of 
her great advantage, and overcome the malignant effects of a 
century of slavery, and of misgovernment and lack of educa- 
tion of almost every kind. 

We welcome her competition. We will emulate her in her 
progress, fiach needs what the other can produce ; and in the 
exchange of service between the States, free and unrestricted 


28 


as it is and as it must remain under the beneficent provisions 
of our Constitution, each section will gain under the working 
of that law which I presented at the beginning of this address, 
— that all true commerce among men, whether between states 
or nations, is but the exchange of service by which both are 
made more prosperous, and both are rendered more capable of 
sustaining their own population in comfort and well-being. 

It will be apparent, if this principle be admitted, — namely, 
that where mental capacity and manual dexterity are combined, 
and are applied under the best conditions to the direction of 
machinery, there will be found the largest production, the 
highest wages, and the safest and most adequate remuneration 
of capital ; and also, if it be admitted that the production of 
the joint work of labor and capital would be most completely 
enjoyed where there is the greatest freedom from what I have 
called destructive taxation, it follows that this country has the 
advantage over all others, — 

1st, In the variety and extent of its natural resources, capa- 
ble of being worked with the least exertion or effort. 

2d, In the fact that in some sections of the country, and 
presently in all, the systems of common education, even if still 
imperfect, yet on the whole do qualify pupils to apply the 
greatest versatility and to combine mental and manual capacity 
at least somewhat more completely than in most other countries. 

3d, In our absolute and paramount advantage in being free 
from destructive taxation. 

From all these advantages, it follows that both the wages of 
labor and the remuneration of capital must be greater in pro- 
portion to the effort used than in any other section of the 
world’s surface ; and these facts themselves prove that the cost 
of production — in other words, the labor expended in produc- 
tive service — is less in ratio to product than it can be anywhere 
else. Therefore our high wages are but the sign and proof of 
low cost, and we may command the commerce of the world, if 
we so elect. 

We may exchange the product of a single day’s work of 
machinery, directed by one man, for fifty or one hundred days’ 
product of those who are still obliged to follow pursuits to 


29 


which either their ignorance, their backwardness in the use of 
machinery, or want of opportunity, prevents the • application 
of their labor under favorable conditions. 

We may obtain the product of perhaps fifty days’ labor in 
the coffee-plantations of South America or of Java; or one 
hundred days’ labor in the tea-fields or mulberry-groves of 
China; or twenty days’ labor in the sugar-plantations of Cuba, 
or the hemp-fields of Manila ; or ten days’ labor in the wool- 
growing sections of South America and Australia, — for the 
work of a single man or woman directing machinery operated 
by steam or water power. By means of such exchange, we can 
increase the quantity of things to be divided among our own 
people, while conferring a benefit even upon those with whom 
we exchange, who without our demand could perhaps make 
no disposition even of the surplus of their hand-work : thus 
both parties are vastly benefited, and commerce becomes the 
measure of intelligence, of civilization, and of wealth. 

Many attempts have been made to compute the actual wealth of a 
state or nation statistically ; but such figures can give only approximate 
estimates at a given time, since progress is much greater by way of 
the destruction of what has been wealth, than by its accumulation. 

The substitution of simple for complex machinery, by means of 
which greater production is assured, coupled with the application 
of capital of less money value, is an instance. 

In this address I have assumed a thousand million dollars’ worth 
of products set aside for the maintenance and increase of capital, or 
ten per cent upon an approximately accurate estimate of an annual 
product of ten thousand million dollars’ worth of substance. 

If five per cent had been set aside for the maintenance of capital 
previously accumulated, and five per cent of our annual product had 
been added each year to the wealth or capital of the country, the 
effect would have been the same as that of money put at compound 
interest at five per cent per annum. There is nothing to show for any 
such accumulation. 

Massachusetts possessed in 1875, according to Carroll D. Wright’s 
most admirable and accurate census, confirmed by the tax commission- 
er’s reports, property aside from the value of land amounting to only 
six hundred dollars per head of the population, which sum measures a 
saving equal to only two or three years’ production of the same State 
in the same year ; and there is probably no state in the world in 
which the annual product per head is larger, being not less than two 
hundred, probably about three hundred, dollars per year per capita. 


80 


Even if ten per cent, or one thousand million dollars’ worth, can be 
set aside, above the mere consumption or cost of production of the 
people of the United States, it is manifest that much more than one- 
half of this substance must be used merely for maintenance of capi- 
tal, much less than one-half for additions to wealth or capital. 

These considerations may be deemed somewhat theoretic, but they 
become of the greatest importance when considered with reference to 
national and municipal taxation. The burthen of a tax is to be con- 
sidered not so much with reference to its ratio to the gross income of 
each state or person, as it is with reference to the possible savings of 
each person or to the margin of profit upon any given business. 

The writer has not himself compiled the figures of national, state, 
and municipal taxes, but is assured upon the latest data compiled in 
the census department that the total amount of all such taxes at the 
present time is 1700,000,000 a year. 

This sum is important, even if it is only considered in ratio to a 
probable product of $10,000,000,000, on which it is seven per cent ; 
yet more important in its ratio to probable saving of $1,000,000,000, 
on which it is seventy per cent ; yet more important in its ratio to 
the probable actual addition to our wealth, even if that amounts to 
$500,000,000, on which it is one hundred and forty per cent; most 
important of all in its ratio to the annual average production 
of each adult man and woman, which I have computed at probably, 
hardly possibly, over one dollar a day, on which the proportion of all 
taxation is seven per cent, or seven cents of every dollar earned. 

Well for us that our taxes are not destructively expended ; well for 
us indeed that the avails of taxation are on the whole productively 
expended, and that not over twenty-five per cent is, in the long-run, 
wasted in national or municipal jobs# 

In view of the fact that all taxes upon commodities are added to 
the cost, and are paid by consumers in the ratio of their consumption, 
the abatement of the excess of national revenue becomes a question 
of paramount interest. 

Such taxes take from the many what they may actually need for 
a bare subsistence ; they must fall with greatest hardship on those 
whose earnings for their families are less than the average dollar a 
day to each adult man and woman ; and where our present excess of 
national taxation may be equal to only fifteen per cent of the possible 
savings of the whole people, it may take a hundred per cent , even 
the little all of what the poor might save. 

The most profound students of the social order of Europe have 
come to the conclusion that national debts and chronic war taxes are 
the prime cause of the pauperism of great masses of the people. 

It is true that this surplus revenue is not lost to the country when 
it is applied to the payment of its debts ; but it may be misspent in 


81 


extravagant expenditures and then it becomes a loss ; and even in the 
payment of debts it takes a part of this year’s product from one, and 
transfers it to another in payment for service in the long-distant past. 
It is useless to palter with such problems as this : our public men 
must either master them, or be mastered by them. They are the great 
political issues of the future, before which all the dead issues of the 
past will fade away. The question to be solved at present is not 
whether one hundred million dollars of excessive taxation — one 
seventh part of the whole burthen — shall be removed, or not: it 
is only in what way shall the relief be given. The evil of exces- 
sive taxation is not simply in the imposition of the taxes but also 
in the method of removal. They may so alter the direction of 
industry as to make even their removal work temporary injury to 
a portion of the people. 

Industrial reconstruction (especially in the South), technical edu- 
cation, tax reform, honest administration, a strict .limitation of the 
functions of government and personal liberty, — such are the subjects 
which the object-lessons in this great fair bring into view. 

I have called your attention to this need of combining the 
instruction of the brain and of the hand together. 

At the other end of this broad avenue stand the buildings of 
the Massachusetts Institute of Technology, where the higher 
branches of technical education, with manual instruction in 
the mechanic arts, have been combined and developed to the 
extent of the means placed at our disposal. 

That institution has been founded and sustained in part by 
the very men who belong to this Manufacturers’ and Mechan- 
ics’ Institute. That institution is yet to be sustained by many 
of you who are here present, when you have found out its 
merits, by contributions from your ample capital, which you will 
make when you have learned that it is the best possible invest- 
ment. 

Each of these institutions is the complement of the other. 
Here you have the visible results of science applied to useful 
arts, the tangible evidences of the opportunity for yet grander 
enterprise. There you have the opening in which you can aid 
in the development of this great work of instructing the brain 
and hand together. Each of these institutions is but the begin- 
ning: they may serve as examples which must be followed in 
New England even if nowhere else. 


32 


If we are to maintain our relative position in competition 
with our sister States, we can only do so by compensating for 
our lack of natural resources by the perfection of our methods 
of instruction in the application of science to the useful arts. 
In sustaining these institutions, you can justify yourselves for 
the possession of more than fifty cents a day for each member 
of your families, by the investment which you may make of 
your surplus wealth. 

May we not share in teaching the teachers of the new gospel 
of peace and plenty, which it is the mission of this country, 
first among all nations, to preach to the down-trodden of the 
world ? To do unto others as you would be done by, is to help 
others to help themselves. To give alms may be dangerous, 
and at best can only palliate the evils and wrongs of society. 
To relieve want by State charity, may only promote pauperism. 
Yet give alms we must, and sustain charitable institutions we 
are compelled to, because we are subjected to the incoming of 
the poor and incapable of other lands. But from our children 
and our children’s children even unto the third and fourth 
generation, we may remove the doom of the ancient law, and 
we may assure them the reward of the faithful steward, by 
developing hand and head together in their application to use- 
ful service. 



few Wand Manufacturers’ and fcliacs 


0 019 269 105 9 


ANNUAL FAIR OF 1882. 


There will be on exhibition in this Fair articles representing 
nearly two thousand varieties, either of agricultural products, 
of tools and implements, of apparatus, or commodities ready 
for final use. Special attention has been given to the collection 
of Southern ores, minerals, timber, and agricultural products. 

New inventions from all parts of the country, and improve- 
ments in old inventions, will be found. 

The collection will comprise: — 

STEAM ENGINES IN VARIETY. 

WOOD-WORKING APPARATUS. 

MACHINERY, TOOLS, AND IMPLEMENTS OF ALL SORTS. 
MACHINISTS' SUPPLIES. 

HOUSE BUILDING EQUIPMENTS AND APPARATUS. 

TEXTILE MACHINERY AND FABRICS. 

JEWELRY AND KINDRED ARTICLES. 

ANTIQUITIES. 

ARTICLES OF HISTORIC INTEREST. 

ART WORKS, CONSISTING OF PAINTINGS, POTTERY, AND THE 
LIKE. 

MUSICAL INSTRUMENTS. 

CARRIAGES, BICYCLES, ETC. 

FURNITURE. 

HOUSEHOLD IMPLEMENTS AND SUPPLIES. 

PAINTS, OILS, AND DRUGS. 

PRINTING. 

GLASS BLOWING — AN EXTENSIVE DISPLAY. 

BAMBOO AND WILLOW WARE. 

TOBACCO IN THE PROCESS OF MANUFACTURE. 

ELECTRIC LIGHTING IN VARIETY, WITH ALL THE APPARATUS 
USED IN CONNECTION THEREWITH. 

GAS ENGINES, ETC., ETC. 

The Second Fair will be open during the months of Sep- 
tember and October. 


